Energy Policy

ACS Position Statement

Energy consumption and production are the defining policy issues of our generation. Energy and its associated costs impact every aspect of the global economy and society. It is an unfortunate truth that no current technology is simultaneously clean, secure, sustainable, and affordable; and advancement led by the private sector is driven by near-term affordability and focused on implementation of mature technologies, which produces only incremental improvements. Transformative leaps, driven by expanded energy research and development, are required to enable a sustainable energy economy.

Government must play a role in guiding energy use, development, and research to ensure long-term economic growth and national security. Continued, robust investment in energy research must be coordinated and emphasize all stages of the process: fundamental research, systems design and analysis, demonstration, and commercialization. Each stage requires sustained support from policymakers if the United States is to transform our energy systems.

The tie between petroleum-based energy and national security is well known, but many energy components are tied to national security through a multitude of complex interdependencies. As our nation relies more on battery storage, we develop a greater dependence on lithium. More than half the world’s lithium is located in Bolivia, and lithium-ion battery production is centered in China. Understanding the complex interplay between critical materials (including rare earth minerals), the broader energy infrastructure, and the need to ensure a sustainable supply of these materials should not be overlooked.

The U.S. Energy Information Agency classifies primary energy consumption by source and sector (U.S. Energy Information Administration, 2011 Annual Energy Review). Currently, there are five primary sources, but traditional fossil sources (coal, gas, and petroleum) account for 81 percent. The five primary energy sources are distributed into four energy sectors. As seen in the chart (Appendix A), the sources and sectors are linked: certain energy sources are more closely aligned with specific sectors of use. For example, 71 percent of petroleum is consumed in the transportation sector; and petroleum provides 93 percent of the energy used in transportation. Parsing the renewable energy sector into specific sources reveals that biofuels comprise 21 percent of this energy source; wind, 13 percent; and solar, only 1 percent. The relationship of energy sources to sectors helps to define potential replacement technologies. Biofuels are a potential replacement for petroleum within the transportation sector, whereas solar and wind are appropriate only for the production of electricity.

The government must take the lead in developing a comprehensive, forward-thinking energy policy that encompasses national security issues and economic and environmental impacts. The challenges associated with energy generation, transmission, and consumption necessitate a comprehensive systems approach, including thorough analyses of alternatives. A large solar array in an unpopulated desert is of nominal use without a transmission and storage system to bring the energy to the cities that need it. Expanding the use of electric vehicles may effectively reduce air pollution, but the resource needs and environmental implications of electric batteries may offset the benefits. In the selection of energy solutions, a full systems analysis must be completed that includes the utility, costs and impacts of the entire life cycle, from resource extraction, through production, consumption, and disposal or reuse.

It is imperative that consumers receive market signals that encourage responsible energy use. ACS supports policies that capture the full environmental, economic, and security costs of fossil fuel utilization and send appropriate price signals to the marketplace. Less mature technologies have not developed the economies of scale associated with traditional fuels and must be nurtured while they gain acceptance and self-sufficiency. Enacting a policy that requires full cost recovery for fossil resources will increase the competitiveness of renewable and sustainable technologies while reducing greenhouse gas emissions.

Using the considerable buying power of the federal government is also crucial to bringing innovative ideas to market. The Department of Defense is investing in a number of sustainable energy resources, and ACS encourages the federal government to build upon this important and laudable initiative. Tax incentives may also be necessary to help establish the economies of scale necessary to ensure the price competitiveness of renewable and sustainable technologies in the marketplace.

A comprehensive energy strategy must balance achievable short-term goals, such as efficiency and conservation, with long-term investment in transformative, sustainable technologies. ACS urges policymakers to take a wide-ranging look at policies to address the needs of the four sectors of the United States’ energy system: (1) Transportation, (2) Power Generation, (3) Manufacturing/Industrial, and (4) Residential/Commercial.

Transportation

A sustainable transportation policy is a generational endeavor, intertwined with our nation’s deep and complicated dependence on petroleum. Automotive efficiency must be improved, with higher fuel efficiency standards for all vehicles. Moreover, if natural gas is to play a role in our transportation system, the government must ensure an adequate supply infrastructure, including refueling stations. This may entail federal subsidies to incentivize private investment.

Electric-hybrid technologies are revolutionizing transportation, but their long-term potential will not be realized without robust federal R&D into advanced battery technology. This materials problem is a major challenge to the broader chemical sciences community, with ramifications for other sectors such as renewable energy storage. Focused, sustained, and predictable federal research efforts are necessary to stimulate major advances in battery storage, weight, and reliability.

Ethanol can be part of a sustainable energy economy, if managed to avoid impacting the food supply; however, it is not a long-term solution to America’s reliance on gasoline. Policymakers should expand research on other viable biofuels, including biodiesel, bio-butanol, and bio-gasoline. Cellulosic biofuel research must also continue, as unlocking the power trapped in non-food plant materials hold the best promise for a truly renewable fuel.

Power Generation

As indicated in Appendix A, 21 percent of the United States’ electrical power comes from our aging fleet of nuclear reactors. Although safety, waste, cost, and proliferation issues must be addressed, no other carbon-free source of 24/7 electric power is readily available: neither solar nor wind will provide constant base power until adequate storage and transmission technologies are developed. A sustained government program to develop and build next-generation nuclear facilities and fuels is a critical part of the transition to a low-carbon economy.

Coal is a plentiful source of electrical power, but its future must be assessed, as it is carbon-intensive and environmentally degrading. Both its extraction and use exact a serious human health and safety toll. With coal as part of the future U.S. energy supply, the CO2 produced from burning coal must be captured and recycled, used as a feedstock, or safely sequestered. The technical, economic, and social barriers to realistic carbon capture, and either utilization or sequestration, are substantial, and must be addressed through research and demonstration.

Policymakers must investigate both regulatory incentives and investments to speed and expand the adoption of mature renewable technologies. The European and Australian “feed-in” tariffs provide an interesting example of successful incentives for rapid adoption of renewable power. An incentive-based program, in combination with higher energy standards, could rapidly transform our energy markets. Regulated utilities and their customers should be encouraged to move to sustainable electricity generation through appropriate financial and legal incentives.

A cohesive national energy integration policy will allow us to look beyond energy generation. The Desert Southwest can provide a robust source of solar energy, and the Great Plains is well positioned to provide wind power. Coastal areas may harness tidal energy; hydropower and geothermal may also enter into the mix. But, to take advantage of these resources, the nation’s electric grid must be transformed. New information, electrical transport, and storage technologies must be integrated into a high-voltage “smart grid” that is capable of transmitting large quantities of electricity from the point of generation to the point of use while rapidly accounting for local-level variability in supply-and-demand.

Manufacturing/Industrial

Relatively clean and domestically available, natural gas is essential for both power and chemical production. The U.S. chemical industry relies heavily on natural gas as a feedstock. The advent of cheap, widely available shale gas creates a tempting incentive to expand natural gas power production. It is important to remember that petrochemicals are not just fuel, but feedstock for the chemical industry and a major component of U.S. manufacturing.

The technology behind non-traditional gas extraction is immature and its broader environmental impacts are not fully understood. More research on the shale gas extraction process is necessary, including its impact on water resources. Appropriate technologies for the treatment of waste materials, including produced and flow-back water, are also required. ACS urges policymakers to be mindful that natural gas can only be an intermediate step in the transition to a sustainable energy future.

Taking advantage of existing heat-intensive manufacturing processes to extract power is an area of the U.S. manufacturing sector ripe for development. Cogeneration, either from industrial use or natural gas- fired power plants, is an untapped source of power and heat. A focused effort of incentives to expand cogeneration should be undertaken.

Residential/Commercial

Improving efficiency and conservation in American households and businesses is the easiest, least expensive, most practical way to dramatically reduce U.S. energy use. ACS embraces this concept, having achieved LEED Platinum and Energy Star certifications for its own buildings.

To encourage efficiency and conservation at the residential and commercial level, policy incentives and regulations must be predictable and ongoing. They may include tax credits or accelerated depreciations for equipment installation. Emphasis must be placed on installing innovative and more efficient energy technologies in new and existing homes. Incentives should be available to both homeowners and builders. Improvements in home and commercial building standards have the potential to broadly improve energy efficiency nationwide.

The Role of Science

The challenges of implementing a sustainable, affordable, and secure energy economy are both scientific and economic. The scientific challenges are substantial and require predictable, sustained investment across a broad range of fields, along with a commitment to development and deployment.

Given increasing pressures on federal resources, policymakers must use the best science to make investment decisions. For example, the Department of Energy’s (DOE) Basic Energy Science Advisory Committee has held a series of workshops over the last decade examining the scientific challenges of many crucial energy fields; including batteries, solar, nuclear, superconductivity, and hydrogen. By examining the state of each technology and its underlying scientific principles, the Committee gave guidance to DOE to help shape its R&D strategy. ACS believes science can aid policymakers in identifying the promises and challenges of a sustainable energy economy.

This type of guidance will be critical to developing market-competitive technologies. History shows that, regardless of national security or environmental costs, the market gravitates towards the lowest-priced resource. To end the United States’ fossil resource dependence, we must strive to not only develop price competitive, sustainable alternatives, but to properly capture the often overlooked national security, environmental, and human costs associated with our energy sources. By focusing research on the future, we can begin to realize a clean, secure energy future.

Appendix A
Primary Energy Consumption by Source and Sector 2011
Appendix B
U.S. Energy Consumption by Source, 2011